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Decarbonization Explained – Definition, Principles, Process & Benefits

Due to the consistent rise in greenhouse gas emissions, the call for decarbonization has never been as urgent as it is now. To understand the increasing criticality of the same, let’s start contemplating the basic definition of decarbonization.

What Is Decarbonization?

‘Decarbonization’ refers to reducing ‘carbon intensity’ and lowering the level of greenhouse gas emissions produced by a multitude of sources. To be more definitive, it involves decarbonizing energy, reducing CO2 levels per unit of electricity generated.


Decarbonization Process: General framework of ‘How to Decarbonize’

After having a fair understanding of what is decarbonization, one might think about where to start from? How to decarbonize? Are there any set decarbonization processes? Hang in there! We’ll delve into the details below.

Step 1: Know your Potential and  Baseline

Knowing about your current status on the decarbonization journey would help you set achievable goals and enable fast decision-making by allowing you to get details about where and how to act. You can start with your decarbonization process by creating baseline emissions by source.

To adopt a well-strategized decarbonization process, you can use data solutions such as software to curate and analyze data.  This will make it easy for you to use the data and share it with your stakeholders. Keeping the stakeholders in the loop is advisable to ensure your decarbonization ambitions align with your organization’s inclination to change.

All Electric World Decarbonization

Step 2: Create and Announce Targets

After analyzing and knowing your goals, it’s time to announce them.

According to one of our research, announcing the goals pushes businesses to set ambitious goals, encourages them to achieve their goals faster, and boosts success.

So, to cite a live example, at Schneider Electric, we have set our goals and announced them, and undoubtedly, it has helped us strive to dedicatedly achieve our goals, whilst setting competitive precedents and new industry benchmarks. Besides, this practice over the years has made us one of the world’s leading sustainable companies.

Step 3: Deploy Decarbonization Programs and Strategies

Due to the varying nature of industries, different decarbonization strategies need to be worked out for different industries to achieve an energy-efficient and decarbonized economy. After all, there’s no one-size-fits-all approach.

With the advancement in technology, for most industries, carbon footprint reduction would involve a unique combination of infrastructure upgrades, data management, digital solutions, etc.

The decarbonization process would thus result in:

  • Energy management with performance tracking and analytics solutions
  • Resource optimization with advanced building management systems, energy performance contracting, etc.
  • Low carbon replacement with alternative fuels, electrification, renewable energy, etc.
  • Supply chain neutrality with lifecycle assessments, sustainable procurement practices, etc.
  • Emission balancing with the help of carbon offset projects.

And, if we understand this closely, following a dedicated decarbonization process has a wider scope than just decreasing emissions – it can help your business achieve efficiency, resilience, competitive advantage and much more.


Step 4:  Monitor and Adjust

Businesses across all verticals might experience many predictable or unpredictable situations on their way to achieving decarbonization objectives, such as, the requirement of additional human capital, reallocation of finances, etc., involving a constant adjustment in your plan.

Therefore, to keep up with the trends, it is imperative to monitor and analyze changes in the business’s internal and external environment. Besides, it is beneficial to keep communicating and conducting discussions throughout the supply chain about the decarbonization processes, strategies, and technologies; this would help achieve federal and corporate goals.


How to Accelerate Decarbonization with Digitization?

The world’s global energy landscape will continue to change in the coming years, as it has changed over the previous 100 years or so. Digitization, artificial intelligence, and the internet of things will lead the way to a decarbonized economy. These technologies have made power generating assets efficient, electric grids more resilient and secure, etc. There would be three key enablers:

1. Transparency of Consumption

The Internet of Things (IoT) allow businesses to collect and analyze resource and energy data, while also provide insights into buildings, systems, and plants. With this, electricity and other resources do not just remain commodities that are simply delivered and used when required. Rather, such solutions can measure what we use and control what we measure, matching consumption to actual targets, forecasts, grid performance and much more. And this would mark the start of the decarbonization process.

2. Analytics and Artificial Intelligence

 Artificial intelligence (AI) has the potential to revolutionize the game. Its capacity to provide comprehensive insights into many elements of a company’s carbon footprint as well as fast cost-cutting victories is a potential path to speeding the decarbonization process and sustainable transformation.

Moreover, large organizations are in an exceptionally advantageous position to profit from AI’s capabilities since their size allows them access to massive data sets, a critical success factor for adopting AI.

3. Digital Ecosystem Collaboration

As it is difficult to combat climate change alone, finding the appropriate technology partner is frequently the quickest, simplest, and most lucrative method to meet decarbonization targets. This is where digital ecosystems may have a significant impact.

Exactly where digital ecosystems enable end-users, technology suppliers, and integrators to collaborate and exchange data for gaining new insights, develop new solutions, and address efficiency and sustainability issues.


The Way Forward

As we can observe extreme climate changes, it is important to make changes in energy sources and patterns of energy consumption. Taking cue to the rising criticality, the world is transitioning to renewable energy sources from the use of fossil fuels. Nonetheless, to make the decarbonized economy a reality, businesses, government and citizens need to take up the challenge of transitioning in transformative ways and drive the way to carbon neutrality.

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